Citizens Electoral Council of Australia

Media Release Tuesday, 5 September 2017

Craig Isherwood‚ National Secretary
PO Box 376‚ COBURG‚ VIC 3058
Phone: 1800 636 432
Email: cec@cecaust.com.au
Website: http://www.cecaust.com.au
 

Four days to have your say on banking ‘crisis management’ bill vs. Glass-Steagall

Australians have just four more days—including today—to make a submission to Treasury on its draft bill giving sweeping “crisis management” powers to bank regulator APRA (Australian Prudential Regulation Authority). See below for instructions.

This bill raises serious questions:

First and foremost, why is the government moving now to prepare a response to a banking crisis? The CEC agrees that the government should prepare for a banking crisis, but the CEC is warning a crisis is imminent—the government is not. So what aren’t they telling the public?

Secondly, why isn’t the government acting to avert a banking crisis, instead of preparing to manage one? As the saying in the United States goes, “banking should be boring”: commercial banks with the public’s deposits should be kept super-safe, separated by a Glass-Steagall firewall from all forms of risky financial speculation, including investment banking and all other financial services. That way, the commercial banks that the vast majority of the public use can’t get into trouble, while any investment banks that do get into trouble can be allowed to fail without consequences for the public or the economy.

A legal expert who studied the draft crisis management bill at the CEC’s request noted that, as the bill is 228 pages and the Explanatory Memorandum is 174 pages, “it is no wonder that MPs have difficulty reading and understanding complex legislation and rely on their parties for explanations and directions as to voting”. Australians must demand their MPs don’t simply rubberstamp this legislation by voting as their party hierarchies order them to.

APRA’s banking dictatorship

APRA has enormous reach, being the regulator of banks, building societies, credit unions, friendly societies, participants in certain credit card schemes and certain purchaser payment facilities, life and general insurance companies and superannuation funds. “From the extent to which those institutions affect almost every aspect of the lives of Australians”, the legal expert warns, “it is obvious that if these ADIs [authorised deposit-taking institutions] are in turn to be under the absolute control of APRA, then APRA wields enormous power.”

The problem is, APRA does not represent the Australian people, it represents the global banking system. Officially, it operates under Treasury, but there is a revolving door between Treasury and the big Australian and international banks—the present Secretary of the Treasury, John Fraser, is from the giant Swiss multinational bank UBS.

Moreover, APRA is funded not by the government, but by the banks it regulates—a clear conflict of interests that explains why the big Australian banks have been able to be so reckless. And on top of it all, APRA represents the Bank for International Settlements (BIS) and its Financial Stability Board (FSB), based in Basel, Switzerland—creations of the Bank of England to do the bidding of the private financial interests of the City of London and Wall Street.

The BIS is called the “central bank of central banks”, but it shouldn’t even exist. For its crimes in assisting Nazi Germany to loot Czechoslovakia and other nations, abetted by the Bank of England, it should have been shut down after the war. Instead, it was protected by its London and New York contacts, and established as the central agency by which the international banks coordinated the global banking system, over and above the authority of national governments. Current APRA boss Wayne Byres was based at the BIS before he took over APRA in 2014.

The FSB, headquartered at the BIS, devised “bail-in” in response to the 2008 crash. Bail-in is used to prop up Too-Big-To-Fail banks by transferring a failing bank’s losses to its “unsecured creditors”, which includes unsuspecting “mum and dad” investors and customers; in Cyprus in 2013 it even included depositors. This draft bill fulfils an undertaking the government made to the FSB.

It is therefore alarming that the draft crisis management bill grants to this unaccountable bureaucracy that represents these supranational agencies sweeping powers to totally control Australian ADIs (banks etc.), insurers and superannuation companies, including the power to: direct their actions; appoint itself to take them over; transfer assets from them; exempt officers, employees, agents and APRA appointees from liability; and to prohibit public disclosure of these directives, i.e. to take over the banks in secret!

Take action!

Here are two immediate actions you can take to oppose the bill and promote Glass-Steagall:

1. If you haven’t yet emailed a personal submission to the Treasury, do so by the 8 September deadline—this Friday—with the message:
   
   Instead of legislating powers to manage the inevitable banking crisis, the government should immediately enact a Glass-Steagall banking separation to avert it.
   
   Email: crisismanagement@treasury.gov.au
   
   
2. Email, phone or visit your local MP to make sure they know about this draft crisis management bill and to tell them not to vote for it, but push Glass-Steagall instead. If you’ve already delivered the CEC’s Glass-Steagall “Proposal” to your MP, follow it up with this information on the APRA crisis management bill; if you haven’t delivered the Glass-Steagall “Proposal”, do both. Ask your MP whether they support giving such sweeping powers, listed above, to APRA, which operates on behalf of multinational banks and the BIS/FSB and not in the interests of the Australian people?